Since launching Anaplan last Fall, we have engaged with hundreds of companies wrestling with outdated planning and forecasting environments. We have run into dozens of tools, hundreds of use cases, and thousands of people all operating independent of each other, often at cross purposes. Now the cloud can weave these together to enable companies, small and large, to improve their decision-making and business execution.
All companies have a unique operating model that defines how they engage with customers, partners and the marketplace. It expresses the structure, activities and interactions of the operations built to anble the company to execute its strategy. These operating models are constantly evolving at the edges. Moreover, acquisitions, restructuring, new product launches, and the expansion into new markets often necessitate reorganizing the operating model to integrate these new initiatives into the fabric of the business. All this change further exacerbates the dispersion of tools, people and processes making it even harder to execute the strategy of the business.
Most companies translate their operating model into a long range plan (“LRP”) for the business. Designed by the executive team of the company, the critical drivers of the business – sales productivity, segment growth rates, production yields, quote to cash cycles, marketing campaign outputs, customer churn, resource utilization and headcount attrition, pricing and deal size, compensation factors, capital requirements, etc. – underpin the structure of the LRP.
Keeping track of all these moving parts and their intersection points becomes increasingly difficult as companies grow. Abstractions of the LRP get “translated” into high level financial models with limited utility to the people in the “front lines” responsible for executing those actions which intersect with the drivers of the operating model. Often the result is the long range plan gets “put on the shelf” to be dusted off periodically for executive off-sites; and, to create power point presentations to the Board of Directors and investors. I have heard many CFOs and CEOs express their futility with all this, declaring that “We don’t do long range planning because our business changes so quickly. Why bother??”
Running asynchronously with the LRP is the annual planning process (“AOP”). The AOP is an effort to translate the operating model of the business, lying dormant in the LRP, into a set of targets, actions and measures that the front lines can act upon. Headcount plans, territory and quota plans, compensation plans, new product plans…. all being set against the blunt instruments of high level targets, e.g., bookings targets, margin goals. How all these relate to the critical drivers of the business as expressed in the operating model gets lost in translation. But at least people have budget to work against and a set of goals to go off and achieve.
Problem is that the interconnect between budgets, the goals people have to achieve and the operating model of the business is lost. To compensate for this, companies are constantly running forecasts and ad hoc queries to figure out what is really going on searching for those first, second and third derivative connections that make the business work, enabling the front lines to achieve their goals and KPIs. So we end up with yet more asynchronous processes that consumes massive amounts of time and resources and money in the quest to connect the dots and make the right decisions that will yield timely, coordinated and relevant set of actions.
Now imagine a world in which all of these analyses, forecasts, budgets, and operating plans are “versions” of the underlying operating model of the business interconnected with the LRP maintained through the strategy hub of the enterprise. The cloud now enables companies to spin thisbusiness intelligence web threading the interconnects together; yet allowing for the web to reconstitute dynamically as changes to the operating model occur. That’s our mission at Anaplan and our all in one Business Intelligence Platform enables your business to quickly and easily build your own business intelligence web without taking on teams of consultants, application specialists and klugey enterprise systems.
Build your LRP using our Living Blueprint and Dimensions Hub. Deploy interactive and dynamic dashboards that capture the key components of the operating model putting them at the fingertips of the executive team. Through these dashboards “versions” of the LRP can be expressed as Annual Plans and Forecasts which link the execution plans of the company together. As your business drivers are changed and updated the impact on the front lines can be quickly understood. Operational plans adapt and their interconnects or gaps can be readily discerned enabling informed decisions to be taken. Ad hoc reports now can be interwoven into a context that gives them actionable meaning. And all those asynchronous activities can be synthesized collaboratively through the cloud.